U.S. Navy Awarded Contract For More
Large-Scale H1N1 Vaccine Manufacturing

Vical Incorporated announced today that the U.S. Navy has awarded
a contract for $1.25 million to support large-scale cGMP vaccine
manufacturing and related clinical and regulatory preparations,
which are already underway, for a Phase 1 clinical trial of the
company's vaccine against A/H1N1 pandemic influenza (swine flu).
The trial will be conducted in collaboration with the U.S. Naval
Medical Research Center (NMRC), a biomedical research organization
within the Navy.

"The current threat from H1N1 influenza and the potential
for other future pandemics from strains like H5N1 call for a proactive
approach to developing new vaccine technologies, such as DNA vaccines,
that can be deployed rapidly," said Vijay B. Samant, Vical's
President and Chief Executive Officer. "We are pleased with
the Navy's vision in funding this important vaccine development
program, which can benefit from their experience and capability
to advance this program to the next stage."

As previously announced, Vical was the first company to produce
a vaccine against the A/H1N1 influenza virus after the initial
reports of widespread outbreaks in Mexico, and the first to announce
robust immunogenicity results from animal testing in two species.
Within days of the outbreaks, the company entered into a Cooperative
Research and Development Agreement (CRADA) with NMRC to conduct
clinical testing of an H1 DNA vaccine formulated with Vical's
patented Vaxfectin(R) adjuvant.

Vical researches and develops biopharmaceutical products based
on its patented DNA delivery technologies for the prevention and
treatment of serious or life-threatening diseases. Potential applications
of the company's DNA delivery technology include DNA vaccines
for infectious diseases or cancer, in which the expressed protein
is an immunogen; cancer immunotherapeutics, in which the expressed
protein is an immune system stimulant; and cardiovascular therapies,
in which the expressed protein is an angiogenic growth factor.
The company is developing certain infectious disease vaccines
and cancer therapeutics internally. In addition, the company collaborates
with major pharmaceutical companies and biotechnology companies
that give it access to complementary technologies or greater resources.
These strategic partnerships provide the company with mutually
beneficial opportunities to expand its product pipeline and address
significant unmet medical needs. Additional information on Vical
is available at www.vical.com.

This press release contains forward-looking statements subject
to risks and uncertainties that could cause actual results to
differ materially from those projected. Forward-looking statements
include statements about U.S. Navy funding, the Vical/NMRC CRADA,
Vical's DNA vaccine and Vaxfectin(R) adjuvant technologies and
their potential application in a vaccine against H1N1 influenza,
potential human clinical testing of such a vaccine, as well as
the company's focus, collaborative partners, and product candidates.
Risks and uncertainties include whether Vical will receive all,
if any, of the committed Navy funding; whether the committed funding
will be sufficient to initiate a human clinical trial; whether
the Navy will provide additional funding as needed to complete
a human clinical trial; whether Vical's technologies will be successfully
applied under the CRADA for the development of a Vaxfectin(R)-formulated
DNA vaccine against H1N1 influenza; whether Vical, NMRC or others
will continue development of any pandemic influenza DNA vaccine
candidates; whether Vical and/or NMRC will terminate the CRADA
before achievement of its objectives; whether the company's DNA
vaccine candidate will be effective in protecting humans against
H1N1 strains of influenza; whether any vaccines based on novel
technologies will be applied for emergency use or future routine
immunizations; whether the influenza vaccine or any other product
candidates will be shown to be safe and effective; the timing,
nature and cost of clinical trials; whether Vical or its collaborative
partners will seek or gain approval to market any product candidates;
whether Vical or its collaborative partners will succeed in marketing
any product candidates; and additional risks set forth in the
company's filings with the Securities and Exchange Commission.
These forward-looking statements represent the company's judgment
as of the date of this release. The company disclaims, however,
any intent or obligation to update these forward-looking statements.